State panel set to meet on casino license

Wednesday 15th April 2020

On the eve of a state Racing Commission meeting on a potential casino license for Pope County, a former mayor reiterated his support for a Mississippi casino operator, while a former commission member wrote that the applicant has a poor business record.

"I'm sure they [the commission members] are still trying to make up their mind on what to do," Randy Horton, a former Russellville mayor, said in an interview Tuesday. "I felt like it was critical to me that we get the right operator, so I needed to speak up."

Horton and Jim Ed Gibson, then-county judge of Pope County, backed Gulfside Casino Partnership's application before leaving office in December 2018.

Gulfside's application was submitted to the commission in May 2019.

All five applicants at that time -- Gulfside, the Cherokee Nation Businesses of Oklahoma, Kehl Management of Iowa, Warner Gaming of Nevada and Choctaw Nation Division of Commerce of Oklahoma -- were rejected by the commission because none were endorsed by local officials who were in office at the time.

Constitutional Amendment 100, approved by state voters in November 2018, allows a new casino each in Pope and Jefferson counties and allowed the expansion of gambling at the racetracks in Hot Springs and West Memphis.

Amendment 100 requires the new casinos to have endorsements from local officials.

The Racing Commission then created a rule that added that the officials must be in office when the application is submitted. The Legislature passed Act 371, which requires the same thing.

Gulfside sued the Racing Commission over the rejection of its license.

On March 25, Pulaski County Circuit Judge Tim Fox kicked Gulfside's application back to the commission to consider it "on its merits."

Fox ruled that both the commission rule and new law were unconstitutional because they impose "an additional qualification ... beyond the plain and unambiguous language of Amendment 100."

The commission meets today to consider whether to accept Cherokee Nation's third application for "good cause" shown, as allowed in commission rules. (The commission had opened a second application window, which has since been abandoned, after county officials endorsed the Cherokees.)

"We pride ourselves in being an operator that follows through on our promises, which is why we have placed such a heavy emphasis on trust, transparency and developing relationships with local officials and the great people of Pope County," said Chuck Garrett, chief executive officer of Cherokee Nation Businesses, in a statement to this newspaper. "Upon conducting its due diligence on the background of all applicants, we are confident that the Arkansas Racing Commission's review of our company and its executives will enforce why incumbent Pope County officials and the community at-large has chosen CNB as its operator of choice."

[DOCUMENT: Letter from Hugh Keating "]

In a letter to the Racing Commission, Horton said he felt it was imperative that his position be made clear and that he refute claims that endorsing Gulfside was a "lame duck" rush to judgment.

[DOCUMENT: Letter from Thomas Akin "]

"I know some may disagree with me due to their own personal agenda. But it is important for the commission to know my support was made after a considerate, deliberate, nearly year-long process with as much due diligence as possible," Horton said in the letter. "It was not a 'knee jerk' reaction. I strongly believe Gulfside far outpaces the other proposals -- in jobs, annual gaming revenue, facilities and overall economic impact. In light of the recent Pulaski County court decision, it is my hope the commission will grant a casino license to Gulfside so they can begin providing benefits to Pope County, as well as the entire state."

But in a letter Monday to Russellville City Council Member Chris Olson, former Racing Commissioner Thomas Akin of Russellville took umbrage with Olson's plan to sponsor a resolution at the council's Thursday meeting to welcome Gulfside to the community.

[DOCUMENT: Letter from Randall Horton "]

"Their extensive record of bankruptcies, endless litigation, federal investigations, delinquent taxes, a money laundering fine, gaming license forfeiture, debt and mass employee layoffs (including their current mass layoff), in my opinion, disqualify them for an official welcome into our city," Akin said in the letter.

In his letter, Akin said he began looking into Gulfside's history when he was approached last year about supporting the company's bid for the license.

His five-page letter alleged that Gulfside's first attempt at casino operations in the late 1980s ended in it laying off its workforce and filing for bankruptcy. Akin said the company "walked out" on debts that included $1 million in unpaid use taxes to the Mississippi Tax Commission, $1.2 million to a local bank, $80,000 to the Mississippi Port Authority and money owed to subcontractors.

Akin's letter was countered by a six-page letter to Olson from Gulfside attorney Hugh Keating.

Keating wrote that gaming in Mississippi "as we know it today" is a result of the trailblazing by Gulfside owners Rick Carter and Terry Green and their mentor William Redd.

"The journey to success has not been without failure and hardship, but throughout the journey there has always been progress," Keating wrote. "It is true that the original Pride of the Mississippi operation moved to Galveston, Texas in the Fall of 1989 and the companies sought relief in Chapter 11 bankruptcy."

Keating also said it was true, as Akin alleged, that one creditor attempted to seize the marine vessel Pride of Mississippi, but "it was never seized and a payment bond was procured and issued." All debts and taxes owed were repaid within a year of filing for bankruptcy, Keating said.

[DOCUMENT: Letter from Thomas Akin "]

Metro on 04/15/2020

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